Financial Enforcement Actions | Week of November 23 to November 29

Financial-Enforcement-Actions-Week-of-November-23-to-November-29

CFTC

1 Enforcement Document

$1,000,000.00 in Fines

Penalties: $1,000,000.00
Respondent: Goldman Sachs & Co. LLC
Violation: Respondent due to a recording failure did not make and keep required recordings of the phone calls of traders and sales personnel in one of its offices that contained the oral communications that led to the execution of swaps and related cash and forward transactions during the relevant period. These failures violated Regulations 23.202(a)(1) and (b)(1) and 23.203(b)(2)… Read More

CFPB

6 Enforcement Documents

$4,547,849.71 in Fines

Penalties: $4,468,224.40
Respondent: Edmiston Marketing, LLC doing business as Easy Military Travel, Brandon Edmiston
Violation: Corporate Respondent has violated the Consumer Financial Protection Act of2010 (CFPA), 12 U.S.C. §§ 5531, 5536; the Truth in Lending Act (TILA), 15 U.S.C. § 1604(a), and Regulation Z 12 C.F.R. §§ 1026.lS(b)-(e), (g) & (h); and the Telemarketing Sales Rule (TSR), 16 C.F.R. §§ 310.3(a)(l)(i). Individual Respondent has violated the CFPA, 12 U.S.C. §§ 5531, 5536; and the TSR, 16 C.F.R. §§ 310.3(b). Under§§ 1053 and 1055 of the CFPA, 12 U.S.C. §§ 5563, 5565, the Bureau issues this Consent Order (Consent Order)… Read More

Penalties: $79,625.31
Respondent: USA Service Finance, LLC
Violation: The Bureau found that USASF engaged in deceptive practices in violation of the CFPA by overcharging service members and their families for a debt-cancellation product that was offered in connection with the Easy Military Travel loans for airline tickets, which USASF purchased and serviced. The Bureau also found that USASF violated Regulation V, which implements the Fair Credit Reporting Act, because it never established, reviewed, or updated any written policies or procedures regarding the accuracy and integrity of the consumer information it furnished to consumer reporting agencies… Read More

SEC

19 Enforcement Documents

$53,285,471.00 in Fines

Penalties: $45,209,819.00
Respondent: Kevin B. Merrill, et al.
Violation: Jezierski and co-defendants Kevin B. Merrill and Jay B. Ledford allegedly attracted investors by making false statements about how investors’ money would be used and propped up their misstatements by creating sham entities and fraudulent documents. Rather than use investor funds to acquire and service debt portfolios as promised, the amended complaint alleges that defendants used the money to make Ponzi-like payments to investors and to fund Merrill’s and Ledford’s extravagant lifestyles. Both Merrill and Ledford pled guilty and were sentenced to 22 years and 14 years of incarceration, respectively… Read More

Penalties: N/A
Respondent: Conrad A. Coggeshall, Defendant, and Business Owners Tax Relief, LLC, Relief Defendant
Violation: Rule 65(d) of the Federal Rules of Civil Procedure, permanently enjoining the Defendant, and his officers, agents, servants, employees and attorneys, and those persons in active concert or participation with any of them, who receive actual notice of the judgment by personal service or otherwise, and each of them, from violating Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)], and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)], and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5]… Read More

Penalties: N/A
Respondent: Michael K. Martin
Violation: The Securities and Exchange Commission (“Commission”) deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) against Michael K. Martin (“Respondent”)… Read More

Penalties: $250,000.00
Respondent: Calumet Specialty Products Partners, L.P.
Violation: Section 13(a) of the Exchange Act and Rules 13a-11 and 12b-20 promulgated thereunder collectively require issuers of securities registered pursuant to Section 12 of the Exchange Act to file with the Commission accurate current reports on Form 8-K that contain material information necessary to make the required statements made in the reports not misleading. As a result of the conduct described above, Calumet violated Section 13(a) of the Exchange Act and Rules 13a-11 and 12b-20 promulgated thereunder with respect to the Form 8-K filed on March 8, 2018… Read More

Penalties: N/A
Respondent: Brett Pittsenbargar, et al.
Violation: The SEC’s complaint, filed in the Central District of California, charges Pittsenbargar and BP Financials with violating the registration provisions of Sections 5(a) and 5(c) of the Securities Act of 1933 and Section 15(a)(1) of the Securities Exchange Act of 1934 and seeks disgorgement of illgotten gains, prejudgment interest, and financial penalties… Read More

Penalties: N/A
Respondent: Rishi Shah, Shradha Agarwal, Brad Purdy and Ashik Desai
Violation: The amended complaint also alleges that Outcome Health manipulated third-party studies to conceal problems delivering ads and make them appear more effective than they were. Outcome Health is alleged to have overstated its revenue in its audited financial statements for 2015 and 2016 by at least $14.3 million and $30 million, respectively, while raising approximately $487 million from a private offering to investors who relied on the false financial statements and false representations about the company’s growth. Nearly half of the funds raised went to Shah and Agarwal, Outcome Health’s co-founders… Read More

Penalties: N/A
Respondent: Greenwood Hall, Inc., PMX Communities, Inc., and SurePure, Inc.,
Violation: PMXO has failed to comply with Exchange Act Section 13(a) and Rules 13a-1 and 13a-13 thereunder because it has not filed any periodic reports with the Commission since the period ended March 31, 2017… Read More

Penalties: N/A
Respondent: Rodney L. Pope
Violation: On September 26, 2019, the Securities and Exchange Commission (“Commission”) issued an Order Instituting Administrative Proceedings Pursuant to Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Notice of Hearing against Respondent Rodney L. Pope (“Pope” or “Respondent”)… Read More

Penalties: $1,500,000.00
Respondent: MiMedx Group, Inc., Parker H. Petit, William C. Taylor, and Michael J. Senken
Violation: The SEC’s complaint, filed today in the Southern District of New York, charges all defendants with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities and Exchange Act of 1934 (“Exchange Act”) and Rule 10b-5 thereunder. The complaint also alleges that MiMedx violated the reporting and recordkeeping provisions of Sections 13(a) and 13(b)(2) of the Exchange Act and Rules 12b-20, 13a-1, 13a-11, and 13a-13 thereunder, and that Petit, Taylor, and Senken aided and abetted MiMedx’s violations of these provisions and the antifraud provisions or that Petit and Taylor acted as control persons for MiMedx’s violations… Read More

Penalties: $3,025,652.00
Respondent: The Nutmeg Group LLC and Randall Goulding
Violation: In a separate order, the Court entered a final judgment against Nutmeg permanently enjoining it from violating Sections 204, 206(1), 206(2), and 206(4) of the Advisers Act and Rules 204-2, 206(4)-2 and 206(4)-8 thereunder. The Court had earlier granted partial summary judgment in favor of the SEC and found as a matter of law that Nutmeg and Goulding violated Sections 204, 206(2), and 206(4) of the Advisers Act and Rules 204-2, 206(4)-2, and 206(4)-8 thereunder… Read More

Penalties: $1,800,000.00
Respondent: The Nutmeg Group LLC and Randall Goulding
Violation: In a separate order, the Court entered a final judgment against Nutmeg permanently enjoining it from violating Sections 204, 206(1), 206(2), and 206(4) of the Advisers Act and Rules 204-2, 206(4)-2 and 206(4)-8 thereunder. The Court had earlier granted partial summary judgment in favor of the SEC and found as a matter of law that Nutmeg and Goulding violated Sections 204, 206(2), and 206(4) of the Advisers Act and Rules 204-2, 206(4)-2, and 206(4)-8 thereunder… Read More

Penalties: N/A
Respondent: International Investment Group, LLC
Violation: The Securities and Exchange Commission (“Commission”) deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Section 203(e) of the Investment Advisers Act of 1940 (“Advisers Act”) against International Investment Group, LLC (“IIG” or “Respondent”)… Read More

Penalties: N/A
Respondent: Ronald J. Roach
Violation: The Securities and Exchange Commission (“Commission”) deems it appropriate and in the public interest that public administrative proceedings be, and hereby are, instituted pursuant to Section 15(b) of the Securities Exchange Act of 1934 (“Exchange Act”) and Section 203(f) of the Investment Advisers Act of 1940 (“Advisers Act”) against Ronald J. Roach (“Respondent”)… Read More

Penalties: N/A
Respondent: NIT Enterprises, Inc., et al.
Violation: Defendants falsely represented to investors that NIT was raising money to fund its efforts to research and develop its radiation protection products, which investors were told would generate significant returns. In truth, Defendants NIT and Smith used only a small amount of funds for development of its products and omitted that Smith misappropriated significant sums of investor funds through diversions to personal bank accounts, to Relief Defendant Ariadni Smith, and to pay for personal expenses, and misused funds to pay large undisclosed commissions to unregistered brokers, including Defendants Ganton and Cleary… Read More

Penalties: N/A
Respondent: Cynthia Holder, CPA
Violation: Respondent willfully violated PCAOB Ethics Code Section EC3, which prohibits PCAOB staff from acting in a manner which might reasonably result in or reasonably create the appearance that the employee is using confidential information obtained through service for the Board for the private gain of any person, within the meaning of Section 4C(a)(3) of the Exchange Act and Rule 102(e)(1)(iii) of the Commission’s Rules of Practice. Respondent willfully violated PCAOB Rule 3500T, which requires members to maintain integrity when performing any professional service in connection with the preparation or issuance of any audit report, within the meaning of Section 4C(a)(3) of the Exchange Act and Rule 102(e)(1)(iii) of the Commission’s Rules of Practice… Read More

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